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New $299 AOL PC Features Open Source Software

Aug 12, 2004, 20:30 (16 Talkback[s])
(Other stories by Brian Proffitt, Colin C. Haley)

By Brian Proffitt, Managing Editor
Colin C. Haley, internetnews.com

Open source software is about to make a big splash on the low-end PC market, though the news has been rather stealthily delivered.

America Online will offer a low-priced hardware, software, and Internet service package beginning next week. The "Optimized PC" bundle includes a computer, 17-inch monitor, and printer for approximately $300, plus 12 months of service from the ISP at $23.90 per month.

The platform for the device will be Windows XP Home Edition, but the PC will also be bundled with the AOL Office Suite, which according to the press releases sent out today is "powered by Sun Microsystems."

A productivity suite from Sun seems pretty familiar, and a little more digging into the product announcment reveals the office suite consists of AOL Office Writer, AOL Office Calc, and AOL Office Impress. This office suite, then, is clearly based on the open source OpenOffice.org, though it is not clear if this is just a revamped version of StarOffice 6.0 or a direct-line decendant of OpenOffice.org.

This move would mark a major move for open source on the desktop, as the PCs will sell in retail outlets such as Office Depot and AOL's other retail partners.

To appeal to computer novices, the package comes with color-coded cords, an instructional poster and video have been included to help make set-up easier.

"We did do a limited test program for the PC a few months ago, the results of which helped in the development of the (Optimized PC)," Jay Esmele, an AOL spokeswoman, told internetnews.com.

There's no time limit for the promotion, Esmele said.

This PC is being aimed at the 27 percent of U.S. households that aren't yet online, as well as another, more specific demographic; AOL also hopes to attract more Spanish-speaking customers. Each PC comes with AOL 9.0 Optimized service, which includes AOL Latino service.

Fifty-five percent of Hispanic households where English is the dominant language are online, compared to only 20 percent of Spanish language dominate households, AOL said, quoting research from the Synovate 2004 Hispanic Report.

AOL also plans to combine three of its brands--Black Focus, Black Voices and Africana.com--into a new online destination for African Americans later this fall.

The promotion comes as AOL looks to offset flagging subscriber numbers. During the second-quarter AOL shed 668,000 subscribers.

It still has 23 million U.S. subscribers and the gradually declining dial-up business will be profitable for several years. A rebounding online ad market helped AOL boost revenue 2 percent in the most recent quarter as well and the company continues to roll out new services.

But to continue to gain from serving ads and selling new offerings, AOL, the Internet arm of Time Warner, must retain a sizeable base.

AOL faces competition from low-priced dial-up ISPs like United Online and EarthLink as well as higher-end broadband providers including Comcast and Verizon Communications.

[Thanks to Nicholas Donovan for the tip.]

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